Court provides valuable insight into the manner in which
aggravated damages will be awarded to employees, and reinforces the
significance of conducting thorough investigations before
terminating an employee for cause.
In Dhatt v. Kal Tire Ltd., 2015 BCSC 1177, the
plaintiff had been employed for approximately 23 years. While
helping move the defendant's shop from one location to another,
he took a battery charger and a pole for himself, on his
understanding that he had been given permission to do so.
Approximately two weeks after removing these items, the plaintiff
was suspended for two days as the defendant believe he lied about
the battery charger. Subsequently, he was terminated for cause. At
no point was the plaintiff given the opportunity to explain his
actions. Following termination, the plaintiff spiraled into a
pattern of depression and alcohol abuse, and was twice admitted
into hospital after threatening suicide. The Court found that the plaintiff had not acted dishonestly
when he removed the items from the defendant's shop and held
that there was no cause for termination. In addition to awarding
the plaintiff 21 months' notice and compensation for lost
long-term disability benefits, the court awarded the plaintiff
$25,000 in aggravated damages as a result of the
failure to provide the plaintiff with an opportunity to respond
to the allegations against him;
failure to take into consideration the plaintiff's
decision to change the penalty from a suspension to
failure to advise the plaintiff why he had been terminated
after originally being suspended.
The fact that it would not have been within the reasonable
contemplation of the defendant that the plaintiff would spiral into
depression and substance abuse did not dissuade the court from
making this award. The court held that it was in the reasonable
contemplation of the defendant that the plaintiff would have some
sort of negative reaction as a result of being terminated for cause
for alleged theft and dishonesty.
Lessons for Employers
This case reinforces the importance of conducting thorough
workplace investigations prior to terminating an employee for
cause, particularly where serious allegations, such as theft or
dishonesty, are at play. In particular, this case reinforces that
prior to terminating an employee for cause, employers should:
conduct thorough investigations that take into consideration
the employee's employment history;
provide the employee with an opportunity to respond to the
allegations raised; and
if suspending an employee prior to completing an investigation,
inform the employee that further penalties, including termination,
may be imposed depending on the results of the investigation.
As can be seen in this case, the failure to take such steps can
have significant and costly consequences, particularly where the
allegations giving rise to termination are serious and capable of
giving rise to negative reactions, such as depression, on the part
of the terminated employee. By conducting thorough and diligent
investigations, employers are able to reduce the likelihood of
exposure to liability for
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